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Q. When does the construction loan term begin?

A. LMCU Construction-to-Permanent Loans have a construction term
of 12 months. The loan term begins on the date the note is signed.

Q. How do payments work during the construction phase of the loan?
A. You’ll pay interest only on the principal balance disbursed when the
billing is generated.

Q. What if the appraised value is lower than expected?
A. Appraisers do a very good job of determining fair value. In the
event that the appraised value is lower than expected, you may be
required to bring additional funds to close. This will depend upon
the loan-to-value ratio that results once the appraised value has
been determined. Should a low appraised value occur, your loan
officer will discuss the available options with you.

Q. Do we need to sell our current home before building a new home?
A. Not necessarily. Consult with your loan officer. LMCU has financing
options to assist, such as bridge loans.

Q. What if the project costs are more than estimated?

A. Cost overruns are a legitimate concern. Overruns can occur due
to unforeseen circumstances or change orders for extras added
by you as the project is built. All cost overruns and change orders
that increase the overall cost of construction must be paid out of
pocket by you.

LMCU is pleased that you have considered us to help you build your new
home. We promise to help make the process smooth and easy. We will be
with you every step of the way.

Call me with any questions!
Doug Martin
Mortgage Loan Originator
NMLS #659614
(239) 281-5585
Doug.Martin@LMCU.org - 21 -